Romania is a southeastern European country that is becoming increasingly popular as a jurisdiction for business registration among entrepreneurs from Europe, Asia, and around the world. Romania has a favorable geographical location, making it a gateway to Europe not only by land but also by sea. In addition to EU member states, this country borders Ukraine by land and has access to the Black Sea, which allows goods to be delivered to the EU by sea. Besides its advantageous geographical position, the jurisdiction has a competitive tax system with surprisingly favorable rates for small businesses (1% or 3%) and low incorporation requirements for companies. This is why company registration in Romania may interest you in starting a business in this wonderful country.
Romania is often chosen for business registration in sectors such as IT, gambling, logistics, construction, agriculture, trade, and many others.
Advantages of Company Registration in Romania
Registering a company in Romania has its advantages, which may help make this jurisdiction the right choice.
Some of them are listed below:
- Fast and relatively inexpensive company registration process
- Access to the European Union market
- No significant capital requirements. Only 50 euros can be deposited
- A foreigner can be both the director and the founder of the company
- Possibility of remote company management
- Simplified tax system for micro-companies with rates of 1% or 3% of turnover
- Support for startups, tax benefits, and investment incentives
- Low labor costs
- Numerous double taxation treaties – 89 countries
- Upon meeting certain conditions, a temporary residence permit for business purposes can be obtained
Forms of Company Registration in Romania
The organizational and legal forms of company registration in Romania are provided by Law No. 31/1990 “On Commercial Companies”. The regulation No. 44 from 16.04.2008 defines the registration procedure for individual entrepreneurs, individual and family enterprises.
The legislation provides for the following forms of business registration:
- General partnership – “SNC”
- Simple limited partnership – “SCS”
- Joint-stock company – “SPA”
- Limited partnership with shares – “SCA”
- Limited liability company – “SRL”
- Authorized natural person – “PFA”
- Individual enterprise – “II”
- Family enterprise – “IF”
As in most countries, the most common form of company registration in Romania is the limited liability company, originally called societate cu răspundere limitată or abbreviated – SRL. The liability of participants in a limited liability company is determined by the amount of each participant’s contribution.
Foreigners can register a company. Romania has no restrictions or requirements regarding the founders of the company or management. The director of the company can also be a foreigner. After registering the company, it is necessary to form the statutory capital, which cannot be less than 200 RON, approximately 50 euros.
The number of SRL founders is limited to 50 participants. The minimum number of founders is 1. The founder can be either a natural or a legal person.
Taxes for Companies in Romania
Romania’s tax system is often a decisive factor when choosing this jurisdiction, as the taxation here is extremely attractive for certain types of businesses. The standard corporate income tax rate is 16% and is paid on the company’s net income. That is, the formula is “income minus expenses.” This type of taxation is suitable for businesses with significant expenses, such as purchasing goods or materials.
Romania is most attractive due to its simplified tax system for micro-companies, which involves paying tax on the company’s total income rather than its net profit, but at a surprisingly low rate – only 1% of turnover. This rate applies to micro-companies with an annual turnover up to 60,000 euros. Upon reaching this threshold, the company moves to the next level of taxation – 3% of turnover, with a maximum income limit of 250,000 euros per year. After exceeding this threshold, the company will be considered a profit tax payer at the general rate of 16%.
It is important to note that from 01.01.2026, the income threshold will be lowered again, and a maximum threshold of 100,000 euros per year is planned. An essential condition for applying the simplified taxation system is employing at least one person in the company. Typically, this person is the director of the company. Employment must occur within 1 month from the moment of company incorporation.
The value-added tax (VAT) rate in Romania is 19%. There are also reduced rates of 9% and 5% for certain goods and services. The VAT registration threshold is 300,000 RON, approximately 60,000 euros.
The dividend tax rate is 10%. However, if the dividends are distributed to the founding company that holds at least 10% of the share capital, the dividend tax will be reduced to 0%. The royalty and interest tax rate is 16%, unless otherwise provided by double tax treaties.
Bank Account for Companies in Romania
According to TheBanks.eu, there are 34 banks operating in Romania. The largest share of the market is held by local banks. The leader is Banca Transilvania, with a market share of about 20-22%. It is followed by Banca Comercială Română with a market share of 15-17%, and BRD with a market share of 12-14%. The fourth and fifth positions are held by the local subsidiaries of international reputable banks Raiffeisen Bank Romania and UniCredit Bank Romania.
When registering a company in Romania, it should be considered that a bank account can only be opened in person by the director, so a trip should be planned in advance if you intend to open an account in a local bank. We assist our clients with opening accounts in local banks.
A good alternative to a traditional bank account can be an account with a payment system, such as Payoneer, Wise, Revolut, or another. If necessary, we also assist with opening an account in payment systems.
Company Reporting in Romania
All companies that are tax residents in Romania are required to pay taxes and submit reports. The fiscal year corresponds to the calendar year unless the taxpayer has chosen otherwise. If the company is a taxpayer under general rules, the reporting is done quarterly by the 25th of the month following the quarter. Annual reports are submitted by March 25 of the year following the reporting year, although since 2021, there has been a temporary provision extending the period until June 25 of the following calendar year.
The reporting for micro-companies is simplified and submitted quarterly by the 25th of the month following the reporting quarter.
VAT reports are submitted monthly or quarterly. Payroll reports are submitted monthly by the 25th of the month following the reporting month.
An audit for Romanian companies is mandatory only under certain conditions, namely when two of the following are simultaneously present:
- Assets of 3,650,000 euros
- Net annual turnover of 7,300,000 euros
- Average number of employees – 50 per year.
Reports are submitted in Romanian in electronic form through the ANAF platform, so you will need professional accounting support. We will help you hire a local accountant.
Process of the Company Registration in Romania
The company registration process in Romania is quite simple and usually takes 1-2 weeks from the moment the necessary documents are received. After receiving the power of attorney and the document package, we submit the documents to the Trade Register (ONRC) for registration and register the company with the controlling authorities.
Documents required from you:
- A scan of the foreign passport
- A scan of the internal passport or ID card
- A scan of a document showing the residential address (must be no older than 3 months)
- A scan of the identification number
- An information form for company registration (sample provided)
- A power of attorney (sample provided)
- A declaration (sample provided)
Scans must be in high-quality color and in PDF or JPEG format.
Tax table
| Type of tax | % |
|---|---|
| Company income tax | 16/1/3 |
| VAT | 19/9/5 |
| Dividend tax | 10/0 |
| Interest tax | 16 |
| Royalty tax | 16 |
Price table
| Service | EUR |
|---|---|
| Company registration | 1450 |
| Legal address for 1 year | 500 |
| Bank account opening in the local bank | 650 |
| Bank account in EMI (Payoneer, Revolut etc.) | 250 |
| Accounting starts from | 200 |
To view the full list of jurisdictions where we provide company registration services, click on this link.
If you are considering company registration in Romania to create a new business or expand an existing one, please leave a request on our website or contact us in any other convenient way.
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